Regarding Plan audits
Jim – loved the article.
I would be comfortable saying 80% of Plan audits are random, pulling FEIN’s out of a hat, and 20% are late contributions/or red flags on the Form 5500s. Paying the audit fees is a side item as a generally well run Plan does not need counsel,…..
If the advice for set-up and administration is wrong, is the client indemnified by the recordkeeper?
It could depend on your agreement with the 3rd party administrator. Many agreements will say exactly what you’re indemnified for. Generally, I would say that you have a legal claim against them as long as you can prove their recommendation and how following that advice led to some type of monetary claim against you. Good luck!
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